How Much Money Have the Obama Administration’s Regulations Really Saved?
OMB’s estimate of $200 billion annually draws mixed reactions.
The latest White House budget office estimate on the impact of federal regulations points firmly toward a verdict that benefits outweigh costs, but observers remained divided over that claim along predictable ideological lines.
In its recent draft annual report to Congress required by the 2000 Regulatory Right to Know Act, the Office of Management and Budget put at $200 billion the annual net economic benefits of major federal regulations reviewed by OMB’s Office of Information and Regulatory Affairs, as estimated from the start of the Obama administration on Jan. 21, 2009, to Sept. 30, 2013.
That number is far higher than the estimated annual benefits, in constant dollars, dating back to Oct, 1, 2003, which it put between $57 billion and $84 billion. The agency acknowledges uncertainty in such efforts to monetize benefits.
The study addressed 116 major regulations ($100 million or more in cost to private sector) coming from the Environmental Protection Agency and the Energy, Transportation and Health and Human Services departments, among other agencies.
But focusing on seven major rules for which both cost and benefit data were available, noted Ronald White, blogging for the nonprofit Center for Effective Government, “the report found that the rules issued in fiscal year 2013 resulted in benefits totaling $31 billion to $81 billion (in 2010 dollars), dwarfing costs estimated at $2 to $3 billion,” for a net benefit of $29 billion to $78 billion.
“It has become all too common to see references to the current administration’s ‘regulatory tsunami,’ focusing on the number of pages of regulations in the Federal Register (as though this is somehow an appropriate measure of regulatory burdens) and an exclusive focus on the costs of regulations," he said. "The draft OMB report underscores that providing essential public health and welfare protections is not only good public policy, but also provides substantial economic benefits to society.”
But Bill Kovacs, senior vice president for the environment, technology and regulatory affairs at the U.S. Chamber of Commerce, told Government Executive, “While this report shows that the number and cost of regulations continues to grow, it again ignores analysis of the fact that the costs of major new regulations are mostly borne by companies, communities and workers, while the benefits are primarily in the future and are spread across the nation. To really understand the impact of the regulatory process agencies, in addition to estimating costs and benefits, we should seriously evaluate the potential loss or shifts in employment caused by the regulations as Congress requires of EPA, but which the agency refuses to do.”